Jeffrey Gedmin: The Tipping Point

Proudly presenting the English version of the latest column of Jeffrey Gedmin in WELT:

The Tipping PointDie Welt, 4.10.2006By Jeffrey Gedmin

There’s much to reflect upon this 16thanniversary of German unification. The two Germanies continue to grow together. A normal sense ofpatriotism is coming back. World Cup soccer was apleasure. With Angela Merkel, the country is, by allaccounts, once again well represented abroad. And thenthere is this: Angela Merkel will not reform theGerman economy.

We can theorize all day why. We can blame it on theGrand Coalition or decry the CSU and socialist wing of Merkel’s own party. Lament the unions and the media, if you will, or pin it on the Chancellor’s own lack of vision and courage. Of course, on her worst day Angie is still not nearly as dreadful as the “We’re-poor-but-sexy” rock star mayor of Berlin, Klaus Wowereit, who wants to sell failure as being cool. But by now anyone who knows anything knows that Chancellor Merkel will not be the one who puts the German economy back on top.

I’m in despair and not waiting for Guido Westerwelle.Desperate about the state of affairs? Read the Tipping Point by Canadian author Malcolm Gladwell. It gives us a hint about how to start a

little revolution. If a small group of sick people can start an epidemic of the flu Gladwell theorizes, then what about agents or other factors that can spread ideas, promote political trends and create social change?

Gladwell argues that word of mouth is a vastly under rated factor in creating any trend. To get word of mouth going, Gladwell says there are three types of people who have a critical role to play: the connector, the person who knows everybody and glues a vast number of people together; the maven, thecollector of all relevant information; and the effective salesmen, who can persuade others of a course of action. I think we need a small army of Internet bloggers with the above mentioned profiles to get the ball rolling.

Then there is the “Law of the Few.” Gladwell says groups of 150 people or less seem to be capable of a roaring success when they have an idea they want topromote. I say our internet bloggers set up a network of subversive clubs. They can circulate samizdatliterature and help build critical mass. Then there isthe power of context. In the 1980s New York suffered terrible problems with crime. The trend wasdramatically reversed. There may have been a number offactors that helped improve the situation. Moststriking, though, was the city’s “broken windowpolicy.” The theory was, fix broken windows in crimeridden neighbours. Fix them immediately, time and again, and be relentless in sending out the signal that lawlessness will not be tolerated. It was the same with New York subways and graffiti. New York’s6,000 subway cars were absolutely covered in the stuff. The city hired a subway director, David Gunn, himself a disciple of Broken Windows, who made surethat each and every subway car defaced was cleaned upimmediately and time and again if vandals insisted onstriking again. It took Gunn’s campaign from 1984 to1990 to fully succeed. Crummy conditions contribute tocrummy social behaviour. The opposite is also true.

Let's use success stories "to clean up" theenvironment. Stories of perseverance and risk, offailure turned into triumph, of people who fight goofyregulations and deplore endless defeatism and pessimism. Okay, this may sound like a stretch. I fearif we wait for the Chancellor, though, we’ll keephaving this same Kohl-Schroeder-Merkel reformconversation. The same conversation, with no tippingpoint insight.

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Comments

Merkel is doing a far better job than presented here. I wonder whether Gedmin has slept over the past few months. The german economy, especially the industry (which was said dead numerous times) has rising orders, the unemployment numbers are going down, the prospectives are better than for the last 7 - 8 years - what exactly does he want?

Note from David: Merkel's poll figures are falling and falling... Nobody in Germany credits the current upswing to the Grand Coalition or Merkel. Also, forecasts for next year (a vat rise of 3 % is to be enacted in January 2007) are rather pessimistic.
Deutscher, where do you live currently? Ever thought of relocating to Germany? It would definitely help you to get a better grip on the economic facts of the country...

What most Americans want: that which is possible. We have a natural adversity to limits.

"the unemployment numbers are going down" This is excellent news. Is the plus 50 crowd getting decent paying jobs again? Has anti-age discrimination been codified yet? Have the small and medium enterprises been freed from all the unnecessary government regulations and government interference?

We lowered our taxes and have cut our deficit in half three years faster than planned. The stock market is hitting all time highs. We have created millions and millions of jobs (I think 6 million). Financed a war, recovered from a recession, and an act of war. We have extremely low unemployment (not to mention 11 million illegal aliens who are working as well).

"What does he want?"

To see progress worthy of the abilities of 84 million Germans, who are well educated, and if one would let them keep their own money, very industrious.

The tipping point won't come in Germany, not like that. Otherwise it would have been here long ago. That's what Germany is all about. It's just an endless succession of compromises here. Keep the old engine running no matter what. There can't be any real reform here because that would mean "losers" and losers are verboten.

Decreasing crime rates has mostly to do with the legalization of abortion which caused a drastic and immediate reduction in crime-causing-age kids just in time for Rudy G. Read about it in FREAMONOMICS. Fascinating stuff. That said, The Tipping Point is a must read for anyone - it is spot-on and carries forward work done by McKinsey in the early 90's (see, "Explosive, Self-Generating Demand" Harvard Business Review 1994..I think).

"Plow through the opening!" - that is what Angela Merkel has asked us Germans to do in her speech on the Day of German Unity. A great vision! Anybody interested in knowing more about it may read at least the beginning of her speech (translation reo):
"I wish to begin with three impressions, three personal experiences. The first occurs in the autumn of 1989. The wall finally came down and I became interested in entering politics - departing my career at the Academy of Sciences and entering into totally new and untested waters. It was then, or around then if my memory is unsure, that a friend gifted me a book with a personal dedication. Michael Schindhelm and I had worked adjacently for several months in GDR-times at the Academy of Sciences. But most of all we had been talking with one another, time and time again - about why we in the GDR could never test our limits, about why much of everything was so rigid, so narrow-minded, so petty, about how splendid the last birthday celebration was, or about our vacation plans, and much more besides.

Yet, the importance of this experience for me lies not in the exact moment in which he presented me his book, but in the dedication itself. It is, to me, the catchphrase for all of my emotions, hopes and desires at the time. He wrote, "Plow through the opening!" (Lit: "go out unto freedom"). That was the most striking thing that anyone could have said to me at the time. And how I got marching off, as did many others - up and out into the open and into its new realm of possibilities. Firstly to help those involved in the "Democratic Awakening", unpacking computers and connecting them up - we could muck in, grab hold - and ultimately, to experience firsthand the reuniting of Germany. Those were incredible days, weeks, and months. Those who did not wager did not win. The attitude with which we, both East and West Germans, strode into those volatile times was: "Ask not about the impossibilities, but rather about the possibilities". This attitude, I’m convinced, should continue in good example for us today.

The second experience takes us to October 3rd, 1990. The weather in Berlin that day was glorious as I made my way to the celebration at the Philharmonic Concert Hall. Holiday spirits were running high. But I myself was feeling a mixture of joy and concern, perhaps even anxiety - for I had just learned that the GDR civil policemen had been dressed in West Berlin uniforms overnight. Their faces, however, still betrayed quite precisely, at least for me, from where they had come. That national and local police officers could change dress overnight was one thing - but transformed into a different way of thinking and feeling as well? And so for me, German Unity began as something of a culture shock. We had considered many, nearly all aspects. But had we sufficiently considered that persons cannot simply deposit in the wardrobe their ways of thinking, feeling and experiencing, and that they may not even want to?

The third impression brings us to the present day. The fact that a woman from the former GDR, as am I, could be privileged to serve as Chancellor of a reunited Federal Republic of Germany, in some ways seems to me after ten months in office almost the daily norm. Then again, in a moment and place like today, the reality of this opportunistic time imparts anew. A good part of Germany’s identity lies in the fact that these progressions are even possible. Many of us have come to learn that things can be more open and go further than anyone first believed possible – and that is wonderful.

Take for example our hosting of the World Soccer Cup this past summer, a time when reaching out in friendship to other peoples was the matter of course. Black, red and gold, the colors from the cradle of German democracy at Hambacher Castle to the present day, symbolized a celebration of optimism, rooted in good German posture in the broadest sense of the term. That Germany and its folk would be celebrating so positively, so contagiously - not because they won, but because they came in third - who ever would have envisioned that in times gone past? The world discovered a new Germany –and that, too, is wonderful." (...)